Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what powers the Financial Conduct Authority has to regulate sports spread bets; and whether those powers have changed since the implementation of the Financial Services and Markets Act 2000.

Under the Financial Services and Markets Act (FSMA) 2000, HM Treasury is responsible for determining the perimeter of financial services regulation, with the approval of Parliament. This is chiefly achieved by specifying the financial services activities that can only be carried out by firms authorised by either the Financial Conduct Authority (FCA) or the Prudential Regulation Authority.

It specifies these activities primarily through the Regulated Activities Order (RAO), a piece of subordinate legislation made under powers in FSMA 2000. HM Treasury can bring an activity into the regulatory perimeter by amending the RAO, subject to Parliamentary approval.

The FCA does not itself have the power to bring any activity into the regulatory perimeter or decide what activities are regulated. This has not changed since the implementation of FSMA 2000.

The FCA CEO raised non-financial spread betting in the annual perimeter meeting in July 2023, and noted that the FCA has clarified that non-financial betting products are not financial instruments and not within the FCA’s regulatory perimeter. The minutes are published online at:

https://www.gov.uk/government/publications/hm-treasury-and-financial-conduct-authority-regulatory-perimeter-meeting-july-2023/hm-treasury-and-financial-conduct-authority-regulatory-perimeter-meeting-july-2023