The boundary line of financial services regulation — which investments and activities fall within FSMA's general prohibition, and the routes by which solicitors can lawfully step outside it.
Carrying on a regulated activity without authorisation is a criminal offence, so everything turns on knowing precisely what counts. This chapter starts with the general prohibition in section 19 of FSMA, the consequences of breaching it and the four elements that must all be present before an activity is caught. It then works through the specified investments under the RAO and the specified activities most likely to arise in legal work — advising on investments, arranging deals, dealing and managing investments. Finally it examines the exclusions that take an activity outside regulation altogether, including the sale of a body corporate and introductions, before turning to the Part XX exemption for professional firms and the conditions and additional rules that come with relying on it.
