UK Financial Regulation (Capital Markets Programme) Quiz 03

Last Updated: June 2024

Table of Contents

UK Financial Regulation (Capital Markets Programme)
Element 3
3.7 Disclosure and Transparency rules
On completion, the candidate should:
3.7.2 know the legal nature and purpose of the UK Takeover Code
(section 2 of the Introduction):
• the six General Principles
• the definitions of:
o “acting in concert”
o “dealings”
o “interest in shares”
o “relevant securities”
3.7.3 understand the principles behind disclosure of interest rules and
why they are required
3.7.4 know the following disclosure of interest rules:
• under the Disclosure and Transparency rules:
o the disclosure thresholds
o to whom disclosure has to be made and within what
timescale
o differing transparency requirements globally
• UK under the Companies Act 2006, Section 793, in relation to
company investigations
3.8 Transaction and Trade Reporting
On completion, the candidate should:
3.8.1 understand the definition of a reportable transaction (FCA and UK
MiFIR)
3.8.2 understand the role and purpose of reporting:
• transaction (UK MiFIR)
• trade (UK MiFIR)
• UK EMIR
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• short selling
• UK SFTR
3.8.3 know which party to a trade is responsible for reporting including
trades carried out by overseas branches
3.8.4 know the reporting channels and systems
3.9 Data Protection Act 2018
On completion, the candidate should:
3.9.1 know the six principles of the Data Protection Act 2018; the role,
responsibilities and accountability of data controllers and data
processors and the rights of individuals in respect of the collection
and use of their personal data and record-keeping requirements of
FCA-regulated firms
3.9.2 know the enforcement powers of the Information Commissioner
and the ability to levy fines
3.10 Prudential Standards
On completion, the candidate should:
3.10.1 know the purpose of the Capital Adequacy Requirement for certain
types of investment firms

Element 4
The FCA Conduct of Business Sourcebook / Client Assets
4.1 The Application and General Provisions of the FCA Conduct of
Business Sourcebook
On completion, the candidate should:
The Firms Subject to the Conduct of Business Sourcebook COBS 1
4.1.1 know the firms subject to the FCA Conduct of Business
Sourcebook [COBS 1.1.1-1.1.3, COBS 1 Annex 1 Part 3, section
3]
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Activities Subject to the Conduct of Business Sourcebook COBS 1
4.1.2 know the activities which are subject to the FCA Conduct of
Business Sourcebook including Eligible Counterparty Business
and transactions between regulated market participants [COBS
1.1.1-1.1.3 Annex 1, Part 1(1) and (4)]
Impact of Location COBS 1
4.1.3 know the impact of location on firms/activities of the application of
the FCA Conduct of Business Sourcebook: permanent place of
business in UK
[COBS 1.1.1-1.1.3 and Annex 1, Part 1(1) and (4)]
Appointed Representatives COBS 1
4.1.4 know how the application of the FCA Conduct of Business
Sourcebook applies to appointed representatives [COBS 1.1.1]
including financial promotions and firm’s responsibilities for
appointed representatives [COBS 4.1]
Electronic Media
4.1.5 know the provisions of the FCA Conduct of Business Sourcebook
regarding electronic media [Glossary definitions of ‘Durable
Medium’ and ‘Website Conditions’]
4.2 Accepting Clients
On completion, the candidate should:
Client Categorisation COBS 3
4.2.1 understand client status [PRIN 1.2.1/2/3, Glossary, COBS 3]:
• definition of client [COBS 3.2]
• the application of the rules on client categorisation [COBS 3.1]
• retail client [COBS 3.4]; professional client [COBS 3.5] and
eligible counterparty [COBS 3.6]
4.2.2 understand client status [PRIN 1.2.1/2/3, Glossary, COBS 3]:
• when a person is acting as agent for another person [COBS
2.4.1– 3]
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• the rule on categorising elective professional clients and the
requirements for clients electing to be professional clients
[COBS 3.5.3 – 9, 3.5.3B/C/E]
• the rule on elective eligible counterparties [COBS 3.6.4 – 6,
3.6.4A/B]
• providing clients with a higher level of protection [COBS 3.7]
• the requirement to provide notifications of client categorisation
[COBS 3.3.1A/B]
Client Agreements and Information Provision COBS 2, 6, 7, 8 & 14
4.2.3 know the requirement for firms to provide client agreements, when
a client agreement is required to be signed and when it is
acceptable to be provided to clients for MiFID business [COBS
8A.1.4 – 8A.1.7, 6.1ZA.5] and Non-MiFID business [COBS 8.1.1 –
8.1.3]
4.2.4 know the requirement to provide information to clients prior to
providing services to clients including information relating to the
nature and risk of the services and designated investments being
offered for MiFID business [COBS 2.2A] and Non-MiFID business
[COBS 2.2, 6.1.1-4 & 14.3.1-10]
4.2.5 know the rules on the provision of information in connection with
the service of managing investments and execution only services
for MiFID business [COBS 6.1ZA.2.1/4/10] and Non-MiFID
business [COBS 6.1.6]
4.2.6 know the rules on the provision of information concerning
safeguarding of designated investments belonging to clients and
client money for MiFID business [COBS 6.1ZA.9] and Non-MiFID
business [COBS 6.1.7]
4.2.7 know the rules on disclosure of costs and associated charges,
timing of disclosure; medium of disclosure, changes to information
provided to the client and compensation information for MiFID
business [COBS 6.1ZA.11-16] and Non-MiFID business [COBS
6.1.9-6.1.16]
4.2.8 know the requirements for an adviser to a retail client to be
remunerated only by adviser charges in relation to any personal
recommendation or related service [COBS 6.1A]
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Reliance on Others COBS 2.4
4.2.9 know the rules, guidance and evidential provisions regarding
reliance on others [COBS 2.4.4/6/7]
4.3 Communicating with Clients, Including Financial Promotions
On completion, the candidate should:
Application of the Rules on Communication with Clients, Including
Financial Promotions COBS 4.1
4.3.1 know the FCA Conduct of Business Rules relating to fair treatment
of customers, the application of the rules on communication to
clients and on fair, clear and not misleading communications and
financial promotions and the additional requirements relating to
retail clients in respect of MiFID business [COBS 4.5A.3] and NonMiFID business [COBS 4.1, 4.2.1 – 4, 4.5]
The Rule on Fair, Clear and Not Misleading Communications and
Identifying Financial Promotions As Such COBS 4.1, 4.2, 4.3 and 4.5A
4.3.2 know the purpose and application of the financial promotion rules
and the relationship with Principles for Businesses 6 and 7 [COBS
4.1]
4.3.3 know the rule on identifying promotions as such [COBS 4.3]
The Main Exceptions (Financial Promotions Order (“FPO”), COBS 4.1
& 4.8 and Glossary Definition of “Excluded Communications”)
4.3.4 know the main exceptions to the financial promotion rules in
COBS [COBS 4.1, 4.8], the limitations in connection to MiFID
business and the existence of the FPO
Types of Communication COBS 4
4.3.5 know the types and methods of communication addressed by
COBS 4
4.3.6 know the rules on prospectus advertisements [PRR 3.3]
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Communicating with Retail Clients

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