SIFA 4.6 Rules and guidance

We have prepared a Reader's Guide to help firms navigate the Handbook - you can access it via 'Handbook' on the CD-ROM or by clicking on 'FSA Handbook' on the homepage of our website.

As explained more fully in the Reader's Guide the provisions in the Handbook do not all have the same status. The difference between Rules and Guidance is important. The Rules in the Handbook (marked with an 'R') create binding obligations on firms. If a firm breaches such a rule, it may be subject to enforcement action and in some circumstances to an action for damages.

Guidance in the Handbook (marked with a 'G') is general Guidance given to more than one firm or individual. Guidance is not binding on a firm. But where a firm follows Guidance that indicates a possible way to comply with a rule or recommends a course of action or arrangement, we intend to proceed on the basis that the firm has complied with the relevant Handbook rule. A small firm may find that Guidance is a helpful indication of how compliance with a Rule may be achieved without devising its own approach to that Rule.

There are also Evidential Provisions. These are rules but they are not binding in their own right - they are marked with a status letter 'E' in the margin or header. You can find a more detailed explanation in the Reader's Guide.

We have introduced two types of Handbook provisions where we have 'copied out' material from UK and EU legislation. Where appropriate a UK and EU flag icon will appear against the relevant paragraphs, and the letters 'UK' or 'EU' used in cross-references.

To help readers we have also introduced other informative text within or at the end of relevant paragraphs of the Handbook. These will be identified as 'Notes'. They will not form part of the legislative material and have no legal status.