An appointed representative is a business that carries on regulated activities without its own FCA authorisation, under the responsibility of an authorised firm called the principal. Section 39 of the Financial Services and Markets Act 2000 exempts the AR from the general prohibition, and makes the principal responsible for what the AR does in carrying on that business, to the same extent as if the principal had expressly permitted it.
The model lets a business start regulated activity quickly under an established firm's permissions and controls. It is common for insurance and mortgage intermediaries, financial advisers, investment advisers and arrangers, credit brokers and firms offering finance at the point of sale.
There are two types. A full AR can carry on any of the activities its principal permits within the scope of the Appointed Representatives Regulations. An introducer AR (IAR) is limited to making introductions and distributing financial promotions, and some notification requirements are lighter for IARs, although the principal must still oversee them.
| FCA population, end March 2026 | Number |
|---|---|
| Principal firms | 2,431 |
| Appointed representatives in total | 33,347 |
| Full appointed representatives | 20,728 |
| Introducer appointed representatives | 12,619 |
The figures come from the FCA's appointed representatives data, published on 5 June 2026.
The changes this article first described in 2022 as proposals are now the rules. The FCA published its final rules in policy statement PS22/11 on 2 August 2022 and they took effect on 8 December 2022. They strengthened principals' responsibilities, required more information about each AR and introduced new notification forms.
| Date | Change |
|---|---|
| 2 August 2022 | PS22/11 final rules published |
| 8 December 2022 | New principal obligations and AR notification forms in force |
| 8 to 12 December 2022 | FCA sent principals a section 165 request for information about their ARs, with responses due by 28 February 2023 |
| 31 July 2023 | Consumer Duty applied to open products, including those distributed through ARs |
| 31 July 2024 | Consumer Duty applied to closed products |
The notice period for a new appointment, which the 2022 proposals described as moving from 60 days to 30, is now 30 days. The annual review, the annual self-assessment and the annual complaints and revenue reporting described in the proposals are all live obligations. The detail is in chapter 12 of the FCA's Supervision manual (SUP 12) and on the FCA's principals and appointed representatives page.
The activities an AR can carry on are set by the Appointed Representatives Regulations 2001. They cover arranging and advising across insurance, investments, home finance and consumer credit broking, among others, but not activities such as accepting deposits or effecting contracts of insurance. The AR's agreement with its principal sets the exact scope, and the AR can only act within both.
The principal's responsibility starts before the appointment. It assesses whether the AR is fit and proper, financially stable and suitable for the activities, and whether the principal itself has the skills and resources to oversee it.
The FCA expects principals to oversee ARs to the same standard as their own employees. Its guidance groups the obligations into five areas.
| Area | What the principal does |
|---|---|
| People | Assesses the fitness, propriety, competence and capability of the AR's senior management, and keeps that assessment current |
| Delegation safeguards | Manages conflicts of interest, applies enhanced monitoring where needed, and extends financial crime policies and procedures to the AR |
| Controls and resources | Assesses regularly whether its controls and resources are adequate; if they are not, notifies the FCA and postpones or ends appointments |
| Risk of harm | Monitors the risk the AR poses to consumers and market integrity, using complaints, file reviews and management information |
| Standards | Holds the AR to the same standards as its own staff, including the Consumer Duty |
In practice that means a documented monitoring plan for each AR, regular file reviews, sales and complaints data reviewed against thresholds, mystery shopping where appropriate, and a clear process for escalating and remedying issues. Where an issue is significant, the principal tells the FCA under Principle 11, which requires firms to be open and cooperative with the regulator.
A general insurance broker acts as principal to 20 ARs. Its monitoring plan rates each AR by volume, complaints and product type. Higher-rated ARs receive quarterly file reviews and monthly sales and complaints data; lower-rated ARs receive a half-yearly review. Each AR has a written annual review covering its senior management, its finances and the adequacy of the principal's oversight, and the board signs off one self-assessment for the network each year. When one AR's complaints double in a quarter, the principal carries out an additional review, restricts the products it may sell until the cause is fixed, and records the decision for the FCA.
The FCA publishes separate guidance for principals with larger networks, where the scale of the network calls for dedicated oversight teams and systems.
Each AR must be reviewed at least every 12 months. The review covers the fitness and propriety of the AR's senior management, the AR's financial position and whether the principal's controls and resources are still adequate for it. It is recorded in writing, and significant issues are escalated to the principal's governing body.
An additional review is needed when an AR changes its business model or regulated activities, is appointed by another principal, or has a significant rise in complaints.
The principal prepares a single self-assessment document covering its AR network, which its governing body reviews and signs off at least every 12 months. It identifies risks and any gaps in compliance, is kept for at least 6 years and is provided to the FCA on request. For a principal with many ARs, it is the document that shows the board understands the network it is responsible for.
Principals report through Connect and RegData. The main deadlines are below.
| Event | Deadline |
|---|---|
| New AR appointment | At least 30 days before it takes effect |
| Change to an AR's regulated activities | At least 10 calendar days before the change |
| Other changes to AR details | Within 10 business days of the change |
| Starting regulatory hosting | At least 60 days before |
| Annual complaints and revenue data for each AR (REP025) | Within 60 business days of the annual reporting date |
REP025 asks for each AR's complaints and its revenue, split between regulated and unregulated business. Keeping that data accurate through the year, rather than assembling it once a year, also gives the principal the management information it needs for oversight.
A principal's financial resources must reflect the business its ARs carry on, including IARs, because the principal is responsible for that business and any redress that follows. Where the principal's permissions require professional indemnity insurance, the cover must extend to the activities of current and former ARs.
Customers of an AR complain to the principal, which handles the complaint under its own procedures and the DISP rules, and the Financial Ombudsman Service treats the principal as responsible. Complaints data feeds both the REP025 return and the principal's monitoring of each AR.
The Consumer Duty applies to activities ARs carry on for retail customers, and to principals whose ARs materially influence or determine outcomes for retail customers even without a direct relationship. The principal's board needs to see how products sold through ARs meet the Duty's four outcomes: products and services, price and value, consumer understanding and consumer support. The firm's guide to Consumer Duty compliance sets out the board's annual report and the monitoring behind it.
The agreement should say when and how either side can end the relationship. When an AR is terminated, the principal notifies the FCA, arranges for existing customers to be looked after and keeps responsibility for business the AR carried on while it was appointed. Where an oversight review finds concerns the principal cannot resolve, the FCA expects it to remedy them or end the appointment.
Many ARs move to direct authorisation as they grow, to gain control over their own permissions and economics. The application follows the full authorisation process, and the AR's record under its principal is part of the evidence the FCA reviews. The firm's guide to applying for FCA authorisation covers that route.
| Factor | Appointed representative | Direct authorisation |
|---|---|---|
| Time to start | From 30 days after the principal notifies the FCA | FCA target of 4 months for a complete application; statutory maximum 6 months |
| Regulatory responsibility | Carried by the principal | Carried by the firm |
| Control of permissions and products | Limited to what the principal allows | Set by the firm's own permission |
| Ongoing cost | Fees to the principal | FCA fees, own compliance staff, capital and reporting |
| Best suited to | New entrants, firms where regulated activity is incidental, fund launches | Firms at scale or with a distinct business model |
Credit brokers face the same choice; the firm's consumer credit authorisation guide covers when brokers apply directly.
The firm's regulatory compliance service reviews principal firms' AR frameworks against SUP 12 and builds the monitoring, review and reporting that the rules require.
A business that carries on regulated activities without its own FCA authorisation, under the responsibility of an authorised principal firm that answers for its conduct.
No. The FCA's final rules in PS22/11 were published on 2 August 2022 and have applied since 8 December 2022.
At least 30 days before the appointment takes effect, through Connect.
At least every 12 months, with an extra review if the AR changes its business or activities, takes on another principal or has a significant rise in complaints.
The annual return in which principals report complaints and revenue data for each AR, due within 60 business days of the annual reporting date.
No. Payment institutions and e-money institutions use registered agents and distributors under the Payment Services Regulations 2017 and Electronic Money Regulations 2011; the AR regime applies to FSMA activities.
An introducer AR can only make introductions and distribute financial promotions, while a full AR can carry on the wider activities its principal permits.
Buckingham Capital Consulting has obtained FCA authorisations since 2013 and advises principal firms on building and running their appointed representative networks, and ARs on moving to direct authorisation. The firm sets up the onboarding, monitoring, annual review and REP025 reporting that SUP 12 requires, and prepares the authorisation application when an AR is ready to stand alone.
Speak to an expert: WhatsApp +44 7563 115980, Telegram @buckinghamcapital or info@buckinghamcapitalconsulting.co.uk.
This article is general information, reviewed against the regulator’s published requirements on the date shown. It is not legal advice; the regulator’s current publications take precedence.