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FCA CP26/10: Simplifying Pensions and Investment Advice Rules Explained
FCA CP26/10: Simplifying Pensions and Investment Advice Rules Explained
The FCA has published Consultation Paper CP26/10, setting out proposals to simplify the pensions and investment advice framework as part of its wider Advice Guidance Boundary Review.
The aim is clear. Make it easier for firms to deliver a broader range of advice services while maintaining appropriate consumer protection.
What is changing under CP26/10?
At the core of CP26/10 is a move to simplify and consolidate existing suitability rules by bringing together COBS 9 and 9A into a single framework.
A key theme is proportionality. The FCA is signalling a shift away from firms feeling they must collect exhaustive information in every case. Instead, firms should focus on what information is sufficient to demonstrate suitability, based on the scope and nature of the advice being given.
This is intended to give firms greater confidence to offer more focused or simplified advice services, rather than defaulting to full holistic advice.
Ongoing advice under review
The FCA is also proposing changes to ongoing advice services.
Most notably, this includes moving away from a mandatory annual suitability review towards more flexible, periodic reviews. This would allow firms to better tailor their ongoing services and fees to different client needs.
This is a notable shift given the FCAā€™s previous supervisory focus on ongoing suitability. However, the regulator is clear that any flexibility must still align with Consumer Duty, with firms expected to demonstrate that services continue to deliver fair value and meet client needs.
The consultation also confirms that firms can charge for ongoing related services linked to an earlier personal recommendation, provided these are clearly explained and deliver fair value.
Simpler, more effective suitability reports
CP26/10 also addresses the content and style of suitability reports.
The FCA is encouraging firms to move away from overly long, compliance driven documents towards clearer, more concise and consumer focused explanations.
Alongside this, the FCA proposes to retire FG17/8 on streamlined advice and replace it with updated Handbook guidance and practical case studies to illustrate how proportionality can be applied.
Areas for further discussion
The consultation includes discussion chapters on:
- Legacy trail commission
- Suitability standards for professional clients
These are not firm proposals at this stage, but signal the FCAā€™s longer term direction of travel as it looks to modernise the advice framework.
What this means for firms
CP26/10 represents a significant shift in how the FCA expects firms to approach advice.
The direction is towards:
- Proportionate suitability assessments
- Greater flexibility in advice models
- Clearer, more consumer focused communications
- A stronger link to Consumer Duty outcomes
For many firms, this creates an opportunity to revisit advice propositions, particularly where simplified or limited scope advice has previously felt too risky from a regulatory perspective.
Timeline and next steps
The consultation is open for responses until 22 May 2026.
Firms should consider engaging with the proposals now, particularly where changes could impact advice models, ongoing service structures or client communications.
Final rules are expected following FCA review of consultation feedback.
Final thoughts
CP26/10 is a clear signal that the FCA wants to unlock innovation in advice while maintaining standards.
The challenge for firms will be striking the right balance. Delivering proportionate, accessible advice without compromising on suitability or Consumer Duty obligations.
We will continue to monitor developments and share further updates as the proposals progress.
Need support reviewing your advice framework or preparing for these changes? Get in touch with B-Compliant.