The Financial Conduct Authority (FCA) is working with HM Treasury to assess whether further legislation is required to regulate appointed representative (AR) regimes.
In early December the regulator announced proposals for tighter controls and greater data sharing on AR firms to cut complaints and consumer harm.
Within its three-year strategy plan, the regulator revealed it is increasing supervision work and activity at the gateway to reduce the most significant risk to consumers posed by such regimes.
In October, it noted half of AR permission applications made by firms using the FCA gateway pilot did not proceed.
It is also consulting on changes to its regime to clarify and strengthen the responsibilities and expectations of principals and increase the amount and timeliness of information it receives on principals and their ARs.
But it added it is also working with the Treasury to assess the need for further legislative change and is currently collaborating with the Treasury on its Call for Evidence and will work closely with the department to consider feedback received and the case for further action.
In December, the regulator said it expected around 10% of ARs to leave the market because of its tighter rules.
And it revealed that principal firms and their appointed representatives (ARs) were responsible for three times more complaints regarding health, protection and other general insurance products than directly authorised firms.
