What is an Appointed Representative?
For guidance from the FCA on what is an appointed representative, please visit their website:
Sturgeon Ventures, acting as the directly FCA Authorised Regulated Principal Firm (Principal Firm), has incubated +300 Appointed Representative Firms (ARF), and hundreds of individuals, since its inception in 1998. They have included: firms advising and or marketing (arranging) hedge funds, venture capital funds, corporate finance clients, private equity clients, capital introduction firms, family offices, energy market participants, both start-ups and established firms. Numerous ARFs have been overseas companies looking to establish a presence in the United Kingdom, especially from the USA. An Appointed Representative can be a Firm or an Individual. There is also the Category of an Introducer Appointed Representative, which can be either a Firm (IARF) or an individual.
Becoming an ARF is one option available to you if you wish to practice regulated activities in the United Kingdom. Full FCA authorisation is another option, but becoming an appointed representative is an acceptable interim arrangement and can indeed become a permanent arrangement.
This way of doing business was originally for insurance market salesmen, so they could build a brand and sell their Principal’s products. It then developed into the Independent Financial Advisor Networks, again for retail clients. Then, in 2003, Sturgeon Ventures created the first Wholesale Appointed Representative for Corporate Finance.
Over the last decade there have been many newer providers of ARFs, but it is important when considering which Principal Firm to select that you carry out Due Diligence on that Principal Firm, obtaining information from current and past clients and the marketplace, and ensure that they understand your business too. They are to be your business partner and their reputation is paramount to your success too.
Neither the ARF nor the IARF is Regulated by the Financial Conduct Authority
The Appointed Representative (ARF) works with a Principal Firm such as Sturgeon Ventures, which is a firm directly authorised by the FCA. An ARF works on behalf of the Principal as an agent. The ARF is not Authorised or Regulated by the FCA and must never hold itself out as being regulated.
Becoming An Appointed Representative Firm
To become an ARF you must first decide which activities you intend to undertake. These regulated activities can then be matched up with a Principal Firm such as Sturgeon Ventures. If you have many aspects to your business, you may have more than one Principal Firm.
How Does the Relationship Work?
Persons who are CF30s within the framework of an Appointed Representative can only arrange or advise a Client within the Permissions of a Directly FCA Authorised Firm. The Individuals are Approved by the FCA as Controlled Functions in the Appointed Representative Firm, to Govern as a CF1 Director or as a CF4 Partner. The Approved Person, who may be giving advice or arranging is the CF30 who sits within the Principal Firm and is linked to the Appointed Representative Firm. The CF30’s activities are monitored by the Principal Firm.
Prior to On-boarding of an Individual within an Appointed Representative Firm to be an approved person, the Principal Firm must ensure that the individuals are Fit & Proper to carry out both the Approved Persons’ Roles and Governance Roles and these individuals then continually follow a monitoring regime to maintain competence. That relationship means that Sturgeon Ventures has full access to the paperwork, staff and offices of the Appointed Representative Firm. As an Appointed Representative Firm, you must show complete transparency at all times. Sturgeon Ventures complies with the FCA’s requirements for Treating Customers Fairly.
Tied Agent Services
Post Brexit the UK never received the Memorandum of Understanding (MOU) with the European Union and thus we lost the Marketing Passport, however all is not lost Sturgeon has a Post Brexit Solution in Germany with a joint venture partner directly authorised by BAFIN please email firstname.lastname@example.org and title your email Tied Agent Firm (TAF) Solutions.
In the first instance, if you have a question, need further information about your activities or an appointed representative application form, get in touch with Sturgeon Ventures. Or contact the FCA Customer Contact Centre.
Tel: 0203 167 4625
Here are some useful links to the FCA website on what an Appointed Representative is and how to become one.
Another useful link to HMRC on appointed representatives/regulatory hosting.