ICOB 3.5 Purpose

Section 21(1) of the Act (Restrictions on financial promotion) imposes a restriction on the communication of financial promotions (non-investment financial promotions in ICOB) by unauthorised persons. A person must not, in the course of business, communicate a non-investment financial promotion unless:

1. (a)

   he is an authorised person; or

2. (b)

   the content of the non-investment financial promotion is approved by an authorised person.

However, the Financial Promotion Order exempts from the restriction created by section 21(1) of the Act certain types of financial promotion.

The purpose of this chapter is to provide rules and guidance for a firm that wishes to communicate or approve a non-investment financial promotion. AUTH App 1 (Financial promotion and related activities) provides further detailed guidance on the financial promotion regime under section 21 of the Act (Financial promotion) which will be relevant in interpreting these rules.

This chapter amplifies, for activities within its scope:

1. (a)

   Principle 6 (Customers' interests) which requires a firm to pay due regard to the interests of its customers and treat them fairly; and

2. (b)

   Principle 7 (Communications with clients) which requires a firm to pay due regard to the information needs of its clients and communicate information to them in a way which is clear, fair and not misleading.