FSMA 2000: Financial Services and Markets Act 2000
The Financial Services and Markets Act 2000 (2000 c. 8) is the primary statute governing financial services and markets in the United Kingdom. It establishes the general prohibition against carrying on regulated activities without authorisation, creating the Part 4A permission framework that regulates fintech activities including digital banking, consumer credit, electronic trading platforms, and designated investment services under the supervision of the FCA and PRA.
At a glance
| Official title | Financial Services and Markets Act 20001 |
|---|---|
| English title | Financial Services and Markets Act 2000 |
| Citation | 2000 c. 8 |
| Jurisdiction | United Kingdom |
| Type | act |
| Adopted | 2000-06-14 |
| In force from | 2001-12-01 |
| Status | in force |
Full text
Official full text: Financial Services and Markets Act 2000 (HTML, en)1 · 16,342 KB · file checked 2026-09-24 · consolidated version of 2026-09-23
Official page: legislation.gov.uk1
Summary
The Financial Services and Markets Act 2000 (FSMA 2000) provides the comprehensive statutory foundation for financial regulation, financial markets, and conduct in the United Kingdom. Enforced by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), the Act applies to banks, investment firms, insurers, consumer credit providers, market operators, and financial technology businesses. FSMA establishes the fundamental 'general prohibition' under Section 19, making it a criminal offence to carry on regulated activities in the UK without authorisation or exempt status. The Act creates the primary UK licensing status known as Part 4A permission, along with recognition regimes for investment exchanges and clearing houses, and individual approvals under the Senior Managers and Certification Regime (SM&CR). Key obligations require firms to continually satisfy Schedule 6 threshold conditions, maintain adequate financial resources and capital, adhere to statutory financial promotion rules under Section 21, obtain prior regulatory approval for 10%, 20%, 30%, and 50% changes of control under Part 12, and submit to extensive investigative and disciplinary sanctions.
Summary written by the Atlas from the official text; the law itself prevails.
Main articles
- s. 1A: Establishes the Financial Conduct Authority (FCA) as the conduct regulator with objectives to protect consumers, enhance market integrity, and promote competition.
- s. 19: Establishes the general prohibition barring any person from carrying on a regulated activity in the United Kingdom unless authorised or exempt.
- s. 21: Restricts unauthorized persons from communicating financial promotions in business unless approved by an authorized person or subject to statutory exemptions.
- s. 22: Defines regulated activities by reference to specified activities carried on by way of business relating to specified investments specified by Treasury order.
- s. 23: Establishes criminal penalties for contravening the general prohibition, punishable on indictment by up to two years' imprisonment and an unlimited fine.
- s. 31: Defines authorised persons under the Act, including firms granted Part 4A permission to carry on regulated activities.
- s. 39: Exempts appointed representatives acting under a written contract and full regulatory responsibility of an authorised principal firm.
- s. 55A: Permits individuals, bodies corporate, partnerships, and unincorporated associations to apply to the appropriate regulator (FCA or PRA) for Part 4A permission.
- s. 55B: Requires applicants and authorised persons to continuously satisfy statutory threshold conditions specified in Schedule 6.
- s. 55V: Sets statutory determination timeframes of six months for complete applications and twelve months for incomplete applications for Part 4A permission.
- s. 59: Requires regulatory pre-approval before an individual performs designated senior management functions within an authorised financial institution.
- s. 178: Requires prospective controllers to give prior written notice to the appropriate regulator before acquiring or increasing control over an authorised firm.
- ss. 181-182: Acquiring control of an authorised firm starts at 10% of shares or voting power (s. 181); increasing control is measured at the 20%, 30% and 50% steps (s. 182). Each step needs the regulator's prior approval.
- s. 205 & 206: Empowers the FCA and PRA to publish public censures and impose unlimited financial penalties for regulatory contraventions.
- Schedule 6: Sets out statutory threshold conditions covering UK office location, effective supervision, appropriate financial and non-financial resources, and suitability.
Licences it governs
Regulators that apply it
Upcoming changes
- Phased implementation under Financial Services and Markets Act 2023 (c. 29): Repeal of retained EU financial services provisions and implementation of the Smarter Regulatory Framework including new designated activities regimes.2
- Implementation of the Credit Institutions and Investment Firms (Miscellaneous Definitions) (Amendment) Regulations 2026 (S.I. 2026/480): Amending definitions and cross-references affecting prudential rules and qualifying holdings.3
Sources
- legislation.gov.uk: contents · retrieved 2026-09-24
- legislation.gov.uk: contents · retrieved 2026-09-24
- legislation.gov.uk: contents · retrieved 2026-09-24
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