The FCA’s proposed streamlining of the Consumer Duty highlights persistent challenges with principles-based regulation. While firms support simplification, many warn that high-level rules risk greater uncertainty and higher compliance costs.

Freshfields counsel Elisabeth Overland said unclear scope and overlaps with existing rules have placed a disproportionate burden on wholesale firms. The FCA aims to clarify expectations, reform client categorisation and potentially remove non-UK business from scope.

Further consultations in 2026 will address distribution chains, customer vulnerability and fair value assessments. Overland noted that continued engagement with industry will be essential to ensure predictability and clarity.

This article was first published in Thomson Reuters Regulatory Intelligence in November 2025.