New Risk Warning Rules For Uk Private Fund Managers: Action Required

In our previous client alert, we mentioned the need for managers to review new rules contained in PS22/10, published by the UK Financial Conduct Authority (FCA).

The rules governing the main risk warnings for financial promotions of high-risk investments will have effect from 1 December 2022.

FCA-authorised managers and distributors/placement agents who wish to promote funds, including non-UK funds to investors who would otherwise be classified as retail investors, will need to ensure that materials, such as private placement memoranda and other promotional communications, include the prescribed risk warning and risk summary. These are discussed below.

The other provisions and the bulk of the new rules, together with a statement of the existing rules in the COBS 4.12 chapter of the FCA Handbook (which will be repealed in their entirety with new rules), the most relevant of which will be those in the new COBS 4.12B, will take effect starting 1 February 2023.