Appointed representatives and principals
An appointed representative (AR) is a firm or person who runs regulated activities and acts as an agent for a firm we directly authorise. This firm is known as the ARs ‘principal’.
There must be a written contract between the principal and the AR documenting the arrangement. The principal takes full responsibility for ensuring that the AR complies with our rules.
As an AR, you need to understand and comply with the regulatory requirements for the business you do. If you want to conduct any regulated activities outside this scope, you have to become authorised in your own right.
You should also allow the principal firm access to your staff, premises and records so they can carry out the necessary checks.
Principal firms should make sufficient checks on the firm or individual to ensure they are financially stable and competent.
When you appoint an AR, you are responsible for:
- the products they sell or arrange
- any advice they give to customers
- ensuring they deliver the 6 ‘treating customers fairly’ outcomes, like a directly authorised firm would