FCA Finalises Simplified UK Ancillary Activities Test
On 19 December 2025, the Financial Conduct Authority (FCA) published a policy statement (PS25/24) finalising the rules and guidance for the Ancillary Activities Test (AAT) under the Ancillary Activities Exemption (AAE). The revised AAT aims to reduce compliance costs and support the competitiveness of the UK commodity derivatives markets. The revision follows consultation and feedback from market participants and is intended to align with the objectives of the UK Wholesale Markets Review and the UK’s secondary international competitiveness and growth objective.Background The AAE exempts a firm from authorisation as an investment firm when its trading in commodity derivatives, emission allowances or derivatives thereof (collectively, commodity derivatives) satisfies the requirements of the AAT, provided the firm does not execute client orders, use a high-frequency algorithmic trading technique or act as a market maker. The AAE can be used by non-financial firms (i.e., end-users) to... Read the complete article here...©2026 Katten Muchin Rosenman LLP
