Appointed Representative Brokers: What It Means for Clients
Some firms that take on retail trading clients are not authorised in their own right. They operate under another firm’s permissions, and the paperwork calls them appointed representatives.
Almost everything published about it is written for the firm considering it. The client on the other side of the agreement is rarely the subject, even though the arrangement decides who answers for the account.
Key takeaways
- An appointed representative is an exempt person, not an authorised firm, working under a principal that accepted responsibility in writing.
- That acceptance covers only the business named in an agreement between the two firms, which the client never sees.
- The FCA’s stated aim is that dealing with an AR leaves a client no worse protected than dealing with the principal direct.
- A tied agent can act for only one investment firm, while an appointed representative may have several principals.
- Where the rules require it, the principal’s insurance must cover former ARs as well as current ones.
Table of contents
- What an Appointed Representative Actually Is
- The Scope of Appointment Is the Whole Question
- Where the Principal’s Responsibility Stops
- Tied Agent Is Not a Synonym
- Whose Permissions Your Account Sits Under
- How to Check the Arrangement Yourself
- What the Principal Owes You After the Arrangement Ends
- Who This Page Is Not For
- Frequently Asked Questions
What an Appointed Representative Actually Is
UK law bars anyone from carrying on a regulated activity unless they are authorised or exempt. An appointed representative is one of the exempt cases, and that exemption is what the arrangement rests on.
The FCA sets out three conditions. The firm must not be authorised in its own right, it must hold a contract with an authorised firm called the principal, and that principal must have taken written responsibility for the activities carried on under it.
So the AR has no permissions of its own to lose. It borrows the ability to do regulated business from a firm that has them and agreed, on paper, to answer for it.
That is not the United States introducing-broker relationship, where both firms are registered. That side is set out in what an introducing broker may and may not do.
The Scope of Appointment Is the Whole Question
The exemption is not general. The FCA describes the AR as exempt for the regulated activity comprised in the business its principal has accepted responsibility for, and nothing wider.
The same boundary appears on the principal’s side. A principal must have a written AR agreement setting out what business the AR can do, and must take reasonable steps to ensure the AR acts within the scope of its appointment.
So there are two documents. One is the client agreement, which the client reads and signs. The other defines what the first may cover, sits between the firms, and is not published.
Protection follows the accepted scope. An activity the principal never accepted is outside it, however routine it looks from the client side. The comparable explainers treat scope as an onboarding step; from the client seat it is the line deciding which firm stands behind a given piece of business.
What is checkable is narrower: the activities recorded against an appointment appear on the register.
Where the Principal’s Responsibility Stops
The FCA is explicit about what these rules are for. The principal carries two duties: making sure an AR is fit and proper before it deals with anyone under its name, and making sure those clients end up no worse protected than they would be dealing with the principal direct.
It is bounded throughout the rules by the same clause: responsibility applies to the regulated activities the principal has accepted responsibility for.
Assessment is meant to happen before any client is taken on. The principal must satisfy itself the AR is fit and proper, financially stable and suitable, then review it every 12 months.
Complaints are visible to the regulator by design. A principal reports complaints and revenue data for its ARs annually through the REP025 return, and a significant rise triggers an extra review. Liability in the US introducing chain runs through a different mechanism, covered in who is liable in an introducing arrangement.
Tied Agent Is Not a Synonym
The two phrases get used interchangeably. They overlap, but one difference matters to anyone reading a firm’s disclosures.
Where a firm is both, it cannot start acting as a tied agent until it appears on the applicable register, and it may act for one investment firm and no more. An appointed representative is generally not limited that way: neither the Act nor the Appointed Representatives Regulations prevent several principals, though the rules bar that for certain business, and the principals must then sign a multiple principal agreement.
The third variant is narrower again. An introducer appointed representative may only make introductions and distribute financial promotions, may have several principals with a contract for each, and sits outside the approved persons regime.
| Client question | Appointed representative | Tied agent | Introducer AR |
|---|---|---|---|
| How many firms stand behind it | Several possible, barred for certain business | One investment firm only | Several, with a contract for each |
| What it may do | What the principal accepted in writing | As accepted, under the tied agent condition | Introductions and financial promotions |
| Register condition before it starts | Applies by activity | Must be on the register first | Reduced notification detail |
| Approved persons regime | Can apply to individuals | Competence obligations apply | Does not apply |
Whose Permissions Your Account Sits Under
The practical question is not what the firm calls itself. It is which entity is named on the agreement, and whose permissions the regulated business runs on.
If that entity is an appointed representative, the permissions are the principal’s. The AR holds none of its own, because holding its own is the one thing the exemption does not allow.
That is separate from where client money sits, covered in where client money actually sits. It also decides who hears a complaint, since the route follows the entity rather than the brand, as set out in which body hears a complaint.
How to Check the Arrangement Yourself
The Financial Services Register is the only current check. It records whether a firm is authorised or an appointed representative, which principal appointed it, and the activities attached to the appointment.
The register is also where the rules send firms: before appointing an AR, a principal must take reasonable steps to find out whether it already has other principals, and the FCA names checking the register as one such step.
Timing explains gaps. A principal must notify the FCA at least 30 days before an appointment takes effect, give at least 10 calendar days notice before the types of regulated activity change, and report other changes within 10 business days. That 30-day figure circulates with nothing attached to it; it is correct, and it comes from the FCA’s guidance for principal firms rather than an industry summary.
Two other numbers circulate that do not belong here. Capital requirement figures and firm-count totals appear in several explainers with nothing supporting them, and both are firm-side.
Checking the entity before depositing is part of the wider check in checking a broker before you deposit. The US lookup is different, covered in how to check a registration.
What the Principal Owes You After the Arrangement Ends
Arrangements end. A principal terminates an appointment, a firm becomes directly authorised, a network drops a member. The published explanations stop there, because from the firm’s side it is over.
It is not over from the client’s side. Where the FCA’s rules require it, a principal must hold compliant professional indemnity insurance covering what its current and former ARs did, introducer ones included.
The word former is doing the work. Business done while the appointment was live does not fall outside the arrangement because the appointment has since ended.
Records outlast the relationship too. A principal must retain its annual self-assessment for at least six years, produce it to the FCA on request, and write up every review it runs on an AR.
Who This Page Is Not For
Anyone preparing to become an appointed representative is in the wrong place: eligibility and onboarding are firm-side questions with their own FCA pages.
Anyone outside the UK regime should treat the detail here as jurisdictional, since these terms exist elsewhere with other meanings.
Anyone looking for a verdict on a named broker will not find one, because status changes and only the register is current. Reclassification is covered in what client categorisation changes.
Frequently Asked Questions
What is an appointed representative broker?
It is a firm that is not authorised in its own right and does regulated business under a contract with an authorised firm, the principal, which took written responsibility for that business.
Is my money as safe with an appointed representative?
The FCA’s stated aim is that dealing with an AR leaves a client no worse protected than dealing with the principal direct, but that responsibility reaches only the activities the principal accepted. Where client money is held is a separate question under separate rules.
What is the difference between a tied agent and an appointed representative?
A firm that is both must appear on the applicable register before it starts acting as a tied agent, and may serve one investment firm and no more. An appointed representative may act for more than one principal, except where the rules bar it, and the principals must then have a multiple principal agreement.
How do I check whether a firm is an appointed representative?
Search the Financial Services Register, which shows whether the firm is authorised or an appointed representative, names the principal, and records the activities attached to the appointment.
What happens if the firm stops being an appointed representative?
The appointment ends, but obligations attached to the period it was live do not all end with it. Where the FCA’s rules require it, the principal must hold professional indemnity insurance covering former ARs as well as current ones.
Sources checked 8 August 2026. Financial Conduct Authority, Responsibilities and how to oversee your appointed representatives, for the written AR agreement, the assessment before appointment, the notification periods, the within-scope obligation, the annual review and six year self-assessment, and insurance covering former ARs. FCA Handbook SUP 12 Appointed representatives, for the exemption conditions, the purpose of the regime and multiple principals. FCA Handbook SUP 12.4 What must a firm do when it appoints an appointed representative or an FCA registered tied agent, for the register condition and the single firm limit on a tied agent. No capital or firm-count figure appears here, because the circulating versions carry no source.
Disclaimer: This article is educational only and is not investment advice, and nothing here recommends any firm. It describes the UK regime only. No named broker’s status is asserted here, and the Financial Services Register is the only current check of whether a firm is an appointed representative and who its principal is. Leveraged trading carries risk and the sum at stake can be lost in full.