The FCA has published a Discussion Paper on proposed changes to the FCA Handbook. These changes will be necessary due to two proposed legislative changes in the regulation of crowd-funding.

Crowd-funding is a method used by individuals, organisations and businesses to raise money through online portals to finance or refinance their activities and projects, with money donated or invested through a larger pool of unrelated individuals or businesses than is available through traditional loan or investment practices.

The government plans to allow loan-based crowd-funding investments (Peer to Peer Agreements) to be included in Individual Savings Accounts (ISAs), in a new component to be known as an Innovative Finance ISA, which will be available from 6 April 2016. Additionally, they intend to amend existing legislation, the Regulated Activities Order, to make the provision of advice about Peer to Peer Agreements a regulated activity. 

The discussion paper sets out the FCA’s proposals on the amendments they intend to make to the FCA Handbook to accommodate these legislative changes and to meet the FCA’s objectives of: securing an appropriate degree of protection for consumers, promoting effective competition, and protecting and enhancing the integrity of the UK financial system.

The FCA have asked for responses via an online form by 31 December 2015.