Financial Services and Markets Act 2000, Schedule 6, paragraph 2E

SCHEDULE 6 Threshold Conditions

2E.A must be a fit and proper person having regard to all the circumstances, including—

(a)A’s connection with any person;

(b)the nature (including the complexity) of the regulated activities that A carries on or seeks to carry on;

(c)the need to ensure that A’s affairs are conducted in an appropriate manner, having regard in particular to the interests of consumers and the integrity of the dfnUK financial system;

(d)whether A has complied and is complying with requirements imposed by the FCA in the exercise of its functions, or requests made by the FCA, relating to the provision of information to the FCA and, where A has so complied or is so complying, the manner of that compliance;

(e)whether those who manage A’s affairs have adequate skills and experience and have acted and may be expected to act with probity;

(f)whether A’s business is being, or is to be, managed in such a way as to ensure that its affairs will be conducted in a sound and prudent manner;

(g)the need to minimise the extent to which it is possible for the business carried on by A, or to be carried on by A, to be used for a purpose connected with financial crime.

Read Schedule 6, paragraph 2E in the full Act → Definitions (6) Cases (5)

Definitions used in Schedule 6, paragraph 2E

regulated activity

“regulated activity” has the meaning given in section 22;

Defined in s.417(1) · see it in the full Act
consumers

“consumers” has the meaning given in section 425A;

Defined in Sch.6 para.1A(1) · see it in the full Act
integrity

(3) In this Schedule, References to “integrity” of the dfnUK financial system are to be read in accordance section 1D(2).

Defined in Sch.6 para.1A(3) · see it in the full Act
the FCA

(2) The Financial Conduct Authority is in this Act referred to as “the FCA”.

Defined in s.1A(2) · see it in the full Act

“the FCA” means the Financial Conduct Authority;

Defined in s.417(1) · see it in the full Act
functions

(4) Neither section 2AB(3)(d) nor the definition of “functions” in paragraph 1 applies for the purposes of sub-paragraph (2).

Defined in Sch.1ZB para.31(4) · see it in the full Act

“functions”, in relation to the FCA or the PRA , means functions conferred on that regulator by or under this Act;

Defined in Sch.6 para.1A(1) · see it in the full Act

(2A) The functions referred to in sub-paragraph (1)(a) include functions of the FCA under the Competition Act 1998 or the Enterprise Act 2002 as a result of Part 16A of this Act ; but this sub-paragraph is not to be regarded as limiting the effect of the definition of “functions” in paragraph 1.

Defined in Sch.1ZA para.23(2A) · see it in the full Act

(4) Neither section 1A(6)(d) nor the definition of “functions” in paragraph 1 applies for the purposes of sub-paragraph (2).

Defined in Sch.1ZA para.23(4) · see it in the full Act
financial crime

“financial crime” is to be read with section 1H(3);

Defined in Sch.6 para.1A(1) · see it in the full Act

Cases considering Schedule 6, paragraph 2E (5)

Stephen Grant Forster t/a Premier Research and Marketing v The Financial Conduct Authority

[2026] UKUT 144 (TCC) · 7 April 2026Interprets

Paragraph 2E was applied as the suitability Threshold Condition. It required compliance with information-provision requirements and the conduct of affairs in a sound and prudent manner; persistent total non-compliance also showed a lack of readiness and willingness to comply. (see paras [3]; [30]; [52]; [74]–[75])

EAK Group Ltd v The Financial Conduct Authority

[2025] UKUT 82 (TCC) · 10 March 2025

Applies the fit and proper requirement. The applicant’s failure to engage openly, cooperatively and transparently with reasonable requests justified the FCA’s conclusion that it was not suitable for authorisation (see paras [78]-[93]).

Ashraf Wealth Management Limited v The Financial Conduct Authority

[2024] UKUT 265 (TCC) · 2 September 2024

The Tribunal applies Threshold Condition 2E to assess whether the Applicant was a fit and proper person, having regard to its connections, activities, management, compliance, prudence, consumer interests and financial-crime risk. (see paras [9],[108]) The Tribunal treats the Applicant’s connections with Mr Ashraf as relevant to the suitability assessment. (see para [9]) The Tribunal treats the nature and complexity of the proposed regulated activities as relevant to suitability and to the Authority’s concern about unsupervised advice. (see paras [9],[98],[108]) The Tribunal treats the need to protect consumers and the integrity of the UK financial system as relevant to the suitability assessment, including concerns about advice quality and client detriment. (see paras [9],[105],[108]) The Tribunal treats compliance with FCA requirements and requests for information, and the manner of compliance, as relevant to suitability. (see paras [9],[107]-[108]) The Tribunal treats the skills, experience, probity and expected conduct of those managing the Applicant’s affairs as relevant to suitability. (see paras [9],[102]-[108]) The Tribunal treats the proposed management of the business and the need for sound and prudent conduct as relevant to the suitability assessment. (see para [9]) The Tribunal treats the need to minimise financial-crime risk as relevant to suitability, including the consequences of inadequate due diligence. (see paras [9],[108],[115])

What each judgment says about Schedule 6, paragraph 2E is in the case-law panel in the full Act.