Financial Conduct Authority—Principles for Businesses (PRIN)
Financial Conduct Authority—Principles for Businesses (PRIN)

The following Financial Services guidance note provides comprehensive and up to date legal information covering:

  • Financial Conduct Authority—Principles for Businesses (PRIN)
  • The Principles
  • Purpose
  • Clients and the Principles
  • Application
  • The Principles and MiFID business
  • Breach of the Principles
  • Conclusions

This Practice Note explains the Principles for Businesses (PRIN) set down by the Financial Conduct Authority (FCA). The Principles form part of the FCA’s High Level Standards set out in the FCA’s Handbook. The Principles are a general statement of the fundamental obligations of firms under the regulatory system.

The  Prudential Regulation Authority (PRA) has equivalent high level standards which are found in the Fundamental Rules contained in its Rulebook. Substantial differences between PRIN and the PRA's Fundamental Rules mean that dual-regulated firms will need to keep those differences in mind when considering how they comply with their conduct and prudential requirements. In particular, the PRA's Fundamental Rules include a requirement for firms to prepare for resolution so, if the need arises, they can be resolved in an orderly manner with a minimum disruption of critical services. For more information on the PRA's Fundamental Rules, see Practice Note: Prudential Regulation Authority—Fundamental Rules.

If a firm breaches one or more of the Principles, it can face enforcement action which could, for example, result in its authorisation being removed. It is vital that all firms are aware of the Principles and ensure they implement them and continually ensure that the required standards are maintained.

The Principles

$1

The Principles are:

  1. Principle 1: Integrity—a firm must conduct its business with integrity

  2. Principle 2: Skill, care