London, 9 December 2025 — The UK’s Financial Conduct Authority (FCA) has launched one of the most far‑reaching rewrites of retail investment rules since the financial crisis, using post‑Brexit powers to scrap much‑criticised EU disclosure templates and redraw the boundary between ordinary savers and professional investors.
The package — described in the City as a regulatory “policy blitz” — is designed to nudge more Britons out of cash and into shares and bonds, while keeping protections in place for those who need them most. [1]
Key changes at a glance
- EU PRIIPs & UCITS disclosure rules scrapped and replaced by a new Consumer Composite Investments (CCI) regime for packaged products such as funds, investment trusts, unit‑linked life policies, structured products and CFDs. [2]
- Shorter, more flexible product summaries replace rigid Key Information Documents (KIDs), with a single headline ongoing charges figure and clearer risk and return information. [3]
- Clearer boundary between retail and professional investors, with wealthy individuals (at least £10m in investable assets) able to opt out of retail protections if they meet strict criteria and give “informed consent”. [4]
- New focus on risk appetite and “opportunity cost” of cash, plus a discussion on curbing “gamification” in trading apps and unregulated exposure to crypto‑assets. [5]
- Forthcoming “targeted support” regime to sit between full advice and generic guidance, giving firms a legal route to offer nudges and ready‑made suggestions to groups of customers. [6]
- Long implementation runway: optional transition starts 6 April 2026; new disclosure regime fully in force on 8 June 2027 after an 18‑month implementation period. [7]
Brexit Britain rewrites the investment rulebook
The reforms are built around a package published on 8 December, including final rules on CCI disclosures (PS25/20), a consultation on investor categorisation and a wide‑ranging discussion paper on the future of retail investment regulation. [8]
In an official statement, the FCA said the measures aim to “empower retail investment, reinforce wholesale markets and maintain the UK’s position as a world‑leading financial centre”, and are intended to build a stronger investment culture by making product information more engaging and useful. [9]
For many in the City, this is also the clearest expression yet of how the UK intends to diverge from Brussels. EU rules for Packaged Retail and Insurance‑based Investment Products (PRIIPs) and Undertakings for Collective Investment in Transferable Securities (UCITS) are being replaced with a bespoke, more principles‑based regime anchored in the UK’s Consumer Duty. [10]
Jonathan Lipkin, director of policy at the Investment Association, called it “one of the biggest weeks for UK retail investment in recent history”, arguing that the reforms more clearly set out the UK’s post‑Brexit direction compared with the EU. [11]
From PRIIPs to CCIs: goodbye rigid templates, hello product summaries
Under the old EU‑derived rules, PRIIPs/UCITS KIDs required firms to present information in highly standardised templates. The FCA’s own behavioural testing found these documents were often long, full of legalistic jargon and rarely read, offering little real help with investment decisions. [12]
The new Consumer Composite Investments regime takes a different tack:
- Scope: It covers most packaged investments sold to individuals, including open‑ended and closed‑ended funds, insurance‑based investment products, structured products and contracts for difference. Around 12.5 million UK adults currently hold a CCI. [13]
- Product summary: Manufacturers must produce a concise, consumer‑friendly summary that sets out standardised data on costs, risk, returns and past performance, but they are free to design the layout, format and additional content so long as it genuinely helps understanding. [14]
- Distributor duties: Platforms, advisers and other distributors must highlight key information before the sale, helping customers focus on what matters rather than wading through pages of boilerplate. [15]
The FCA explicitly wants firms to avoid “information overload” and to put the emphasis on language that ordinary savers can understand, rather than compliance‑driven jargon. [16]
Costs and charges: a single headline figure
Cost disclosure has been one of the thorniest issues under PRIIPs, not least for investment trusts that argued their charges were effectively being counted twice.
Under the new rules:
- Funds must show a headline ongoing charges figure (OCF), both as a percentage and in pounds and pence.
- One‑off costs (such as entry or exit charges) and explicit transaction costs must be disclosed but kept separate from the OCF instead of being bundled into a single number.
- The regime expands standard risk scores from a 1‑7 to a 1‑10 scale based on 10‑year volatility. [17]
Industry bodies representing investment companies, which had long warned that double‑counting made them look artificially expensive, have welcomed the change. Richard Stone, chief executive of the Association of Investment Companies (AIC), hailed the outcome as a “victory for common sense”, highlighting in particular the decision not to force other funds to roll investment‑trust costs into their own OCFs. [18]
The FCA has also confirmed that gearing and real‑asset maintenance costs do not have to be included in the ongoing charges figure, though they must still be available to investors elsewhere. [19]
Timeline: when will investors notice the difference?
The CCI regime is not an overnight switch.
- The FCA has set an 18‑month implementation period from 8 December 2025. [20]
- An optional transition window opens on 6 April 2026, when manufacturers (including those in the overseas funds regime) can choose either to start using a product summary or to stick with existing disclosure requirements. [21]
- The new framework becomes mandatory on 8 June 2027, after which PRIIPs/UCITS‑style KIDs will disappear from the UK retail market. [22]
Some commentators in the investment‑trust world caution that while the reforms remove a major structural headwind, it may take time to repair the damage done by years of confusing disclosures and reduced appetite from wealth managers. [23]
Who counts as “professional” now? A sharper line in the sand
A second pillar of the package is a re‑think of how investors are categorised.
Today, being treated as a professional client generally means losing protections such as the Consumer Duty and certain suitability checks — but gaining access to a wider set of products, including private markets and complex instruments.
The FCA’s new proposals would:
- Keep the overall threshold high for professional status, to limit it to genuinely sophisticated or well‑advised investors. [24]
- Allow individuals with at least £10m in investable cash to opt out of retail protections, provided firms can demonstrate they meet knowledge/experience tests and obtain explicit “informed consent”. [25]
- Scrap the existing “quantitative test”, which looked at whether clients had traded frequently enough in the past — a metric the FCA says was open to abuse. [26]
The regulator argues that clearer categorisation will free wholesale markets from unnecessary retail‑focused guardrails, while ensuring only those able to bear losses are taken outside the Consumer Duty. [27]
A consultation on the new classification rules runs until 2 February 2026, and lawyers warn that firms will need to revisit client files, upgrade onboarding checks and document consent carefully if they wish to rely on the new regime. [28]
Targeted support: advice‑lite for the mass market
Another closely watched part of the package is the FCA’s ongoing work on the “advice‑guidance boundary”.
Later this week, the watchdog is expected to publish final rules for a new category called “targeted support”, designed to sit between full personalised advice and generic guidance. Under the regime, firms would be able to offer ready‑made suggestions to groups of customers in similar situations — for example, people hoarding large amounts of cash in low‑yield accounts or saving too little for retirement. [29]
Earlier consultation material suggests:
- The regime will be open to a wide range of firms, from banks and platforms to insurers and SIPP operators.
- The FCA expects around 96 firms to adopt targeted support initially, with typical customers having average wealth of roughly £37,000. [30]
- New rules in the COBS 9B section of the Handbook will codify requirements around pre‑defined “customer situations”, consumer segments and “ready‑made suggestions”, backed by a “better outcomes” test. [31]
Consultants at KPMG argue the regime could be “transformational” for people who cannot afford or access full advice, but warn of risks around conflicts of interest, blurred boundaries and the need for robust testing of communications to ensure customers understand that targeted support is not bespoke advice. [32]
Risk, cash hoarding and gamified trading apps
Alongside the rule changes, the FCA has opened a broader conversation about how Britons think about investment risk.
A new discussion paper asks whether current warning labels are actually helping consumers, or simply scaring them away from productive risk‑taking. The regulator says it wants people to understand the “opportunity cost” of holding assets in cash, especially over the long term. [33]
The paper also questions:
- Whether additional safeguards are needed to curb “gamification” features in trading apps — such as confetti animations or game‑style rewards — that can encourage excessive trading or risk‑taking.
- How to handle the growth of crypto‑hoarding companies, listed entities that hold large amounts of cryptoassets on their balance sheet and give investors indirect exposure without full regulatory protections. [34]
Industry lawyers say this shows the FCA is trying to strike a balance: pushing savers to take more productive risk in mainstream markets, while staying alert to new forms of speculation and behavioural bias in digital platforms. [35]
Industry reaction: enthusiasm, with a note of caution
Market participants have largely welcomed the reforms.
- The Investment Association views the package as a defining post‑Brexit moment that could foster a more robust culture of retail share ownership, bringing the UK closer to markets such as the US and Nordic countries where individual investors play a bigger role. [36]
- Jonathan Parry of law firm White & Case expects greater retail participation to “improve access to capital for companies”, helping domestic firms tap a broader local investor base. [37]
- The AIC’s Richard Stone praised the end of cost “double‑counting” for investment companies and the recognition that their unique structure means returns are primarily driven by the share price, not by annual report line items. [38]
Quilter’s interim proposition director, Barry Cook, said the reforms should deliver “meaningful benefits for both consumers and providers”, particularly by replacing long, jargon‑heavy documents with more engaging product summaries that reward firms which prioritise clarity and good outcomes. [39]
Martina Keane, financial services leader for EY UK & Ireland, linked the changes to chancellor Rachel Reeves’s recent Budget pledge to boost consumer and business investment, arguing that simpler disclosures, clearer professional‑investor boundaries and a structured targeted‑support regime could all help turn that ambition into reality. [40]
Still, some observers warn of trade‑offs. Guy Wilkes of Mishcon de Reya has described the new approach as more “grown‑up” for firms but cautioned that outcome‑based rules give greater discretion — and therefore more scope for bad actors if supervision and enforcement do not keep pace. [41]
EU‑based firms marketing into the UK may also face complexity as they juggle the UK’s flexible CCI regime with the EU’s more prescriptive PRIIPs and UCITS requirements, potentially raising costs or limiting product choice for cross‑border investors. [42]
What this means for everyday investors
For retail savers, the changes will not transform the experience overnight — but over the next couple of years, several things are likely to become more noticeable:
- Shorter, clearer documents
Expect to see fewer dense PDFs and more concise product summaries, ideally in plain English and integrated into online journeys. You should still be able to compare basic metrics like cost, risk and past performance across similar products. [43] - More explicit cost information
The separation of ongoing, one‑off and transaction costs should make it easier to see what you are paying each year, and to understand the impact of entry/exit charges without them being rolled into a single opaque figure. [44] - A push away from cash
Messaging from firms and regulators is likely to stress the long‑term cost of staying in cash, especially for goals like retirement. That does not mean everyone should rush into high‑risk assets, but you can expect more prompts to consider appropriate investments. [45] - New forms of guidance
As targeted support rules come in, banks, platforms and pension providers may start offering tailored nudges — for example, suggesting you move surplus cash into an ISA or increase pension contributions — without calling it “advice”. Consumers will need to understand where this sits legally and what recourse they have if things go wrong. [46] - More questions from firms
Firms will likely ask more detailed questions to determine whether you are a retail or professional client, particularly if you are a wealthier or more experienced investor. Saying yes to professional status could open up more opportunities but also reduce your protections. [47]
Outlook: a more invested Britain?
The political and regulatory mood music is clear: the UK wants more of its citizens to own productive assets — whether through direct shareholdings, funds, or pensions — and to channel more domestic capital into growth companies and infrastructure.
This week’s package goes with that grain by:
- Making investment information shorter and less intimidating.
- Giving firms incentives to design better customer journeys.
- Opening the door for mass‑market, low‑cost guidance via targeted support.
- Freeing professional markets to innovate, while trying to keep retail safeguards where they matter most. [48]
Whether it works will depend on implementation: how creatively firms use their new flexibility, how firmly the FCA supervises outcomes, and how quickly trust can be rebuilt in parts of the market that feel burned by years of confusing rules.
But if the reforms do succeed in drawing more UK savers into long‑term investing — without repeating past mis‑selling scandals — this week may be remembered as a turning point in Britain’s post‑Brexit financial story.
References
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